NASCAR’s Charter System: A Decade of Guaranteed Starts and Growing Pains Amidst Legal Battles

The 2025 NASCAR Cup Series season marks a significant milestone, signifying a full decade of operation under the ownership charter system. This year also heralds the debut of the second iteration of the charter agreement, representing the first extension of a framework initially established in anticipation of the 2016 season. However, the commencement of this new era is shadowed by a high-profile lawsuit filed by two teams, alleging federal antitrust violations against the sanctioning body, stemming directly from the protracted negotiations surrounding the charter system’s extension.

At its core, the ownership charter system grants specific entries guaranteed starting positions in every NASCAR Cup Series race, coupled with a predetermined revenue stream based on negotiated terms for each charter period. The initial agreement, mirroring the length of a television rights deal, spanned from 2016 to 2024. The current, extended agreement is set to run from 2025 to 2031, aligning with the next major broadcast rights cycle. In exchange for these benefits, charter holders are obligated to participate in agreed-upon marketing initiatives, and they grant NASCAR the rights to utilize their intellectual property for the promotion of the sport.

While this provides a foundational understanding, the system’s intricacies extend further. Teams have increasingly come to view these charters as akin to franchises in traditional American sports leagues, such as the NFL’s New England Patriots or MLB’s Los Angeles Dodgers. The underlying philosophy is that each car number represents a distinct, professional entity. However, a critical distinction remains: the NASCAR Cup Series, unlike many established sports leagues, does not operate as an equal partnership between the teams and the sanctioning body, a point of contention that forms a significant part of the ongoing legal dispute.

Currently, there are 36 ownership charters in NASCAR, conferring a suite of shared advantages to their holders under the Cup Series banner. The most crucial of these is the guaranteed starting spot in every event, irrespective of the number of entries on any given race weekend. This ensures a baseline level of competition and financial predictability for chartered teams. Similar to revenue sharing models in other professional sports, where teams benefit from national television contracts and licensing agreements, NASCAR Cup Series teams receive analogous financial distributions as stipulated by their charter agreements.

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It is important to note that the financial value of these 36 charters is not uniform. A charter’s worth is intrinsically linked to the performance of its associated car over the preceding two seasons. The end-of-year payout for each team is calculated using a formula that factors in both the charter’s established value and the team’s final standing in the championship standings. This performance-based valuation system incentivizes consistent success and contributes to the dynamic economic ecosystem surrounding the charters.

Furthermore, the charter system incorporates a crucial element of collaborative decision-making, providing charter holders with a "seat at the table" for competition-related discussions. This framework operates in a manner analogous to Formula 1’s Concorde Agreement, fostering a degree of dialogue between NASCAR and the teams on matters pertaining to the sport’s competitive direction. This collaborative approach is often facilitated through the Race Team Alliance (RTA), a union-like entity representing a majority of the Cup Series teams. The RTA maintains its own media arm, Racing America, and possesses a dedicated negotiating committee that engages with NASCAR on significant business matters.

The maximum field size for a NASCAR Cup Series race is set at 40 cars. This allows for up to four non-chartered entries to compete, provided they meet the necessary qualifications. However, these non-chartered teams receive significantly reduced purse money compared to their chartered counterparts, highlighting the financial disparity and the inherent advantages of holding a charter.

The very inception of the charter system was driven by a dual objective: to cultivate long-term value for team ownership and to stimulate competition for acquiring these charters. The underlying economic theory was that if charters possessed inherent value, they would also command a significant valuation upon resale. In eras preceding the charter system, when a Cup Series team ceased operations, its assets often held little to no residual value beyond physical infrastructure. Race cars quickly became obsolete, and equipment was frequently liquidated at a fraction of its original cost. The escalating value of ownership charters has, therefore, fostered a robust supply-and-demand dynamic in the open market.

The introduction of the Next Gen car, now in its fourth season of competition, was also intended to contribute to long-term cost containment. While its full economic benefits are still materializing, the car’s design as a de facto spec vehicle, with identical components apart from engines and bodywork, aims to standardize parts and foster cost savings as inventory builds. The theoretical outcome is that if the Next Gen car effectively reduces competition costs and future broadcast rights agreements generate increased revenue, teams will become less reliant on sponsorship income for their financial stability.

Each ownership charter has the provision to be leased to another organization for a single season within an agreement period, but it must be returned to its original owner at the conclusion of that season. The initial charter agreement was in effect from 2016 to 2020. The current agreement, running from 2021 to 2024, is tied to the existing television broadcast partnerships with FOX and NBC. The upcoming broadcast rights agreement, from 2025 to 2031, includes FOX, NBC, TNT, and Amazon Prime.

There are currently 36 charters in circulation, though NASCAR retains the discretion to adjust this number, which would correspondingly impact payout structures. Since the charter system’s inception, numerous charters have been bought and sold, reflecting their increasing market value. The following details the lineage of each ownership charter entering the 2025 season.

Trackhouse Racing No. 1: This charter, currently owned by Trackhouse Racing and associated with the No. 1 car driven by Ross Chastain, was initially awarded to Chip Ganassi Racing in 2016. It was piloted by Jamie McMurray and later Kurt Busch before Trackhouse acquired Ganassi’s NASCAR assets after the 2021 season, relocating Chastain from the No. 42 to this chartered entry.

Team Penske No. 2: This charter has consistently been aligned with Team Penske’s No. 2 car, driven by Austin Cindric. It was driven by Brad Keselowski when the charter was first awarded and has remained with the team as Cindric took over driving duties.

Richard Childress Racing No. 3: This charter has always been associated with Richard Childress Racing’s No. 3 car, driven by Austin Dillon, since its inception.

Front Row Motorsports No. 4: This charter was most recently associated with Noah Gragson in the No. 4 car. Prior to 2024, it was tied to Stewart-Haas Racing’s No. 4, driven by Kevin Harvick and subsequently Josh Berry. Its transfer to Front Row Motorsports in 2024 became a point of contention within the ongoing antitrust lawsuit.

Hendrick Motorsports No. 24: Currently owned by Hendrick Motorsports and associated with William Byron’s No. 24, this charter originated as Hendrick’s No. 5 entry driven by Kasey Kahne in 2016, later becoming the No. 24 when William Byron joined the Cup Series.

Team Penske No. 12: This charter, owned by Team Penske and driven by Ryan Blaney, has a complex history. It began with Roush Fenway Racing as the No. 6, was leased to JTG Daugherty Racing, and eventually acquired by Team Penske to establish their third entry.

Kaulig Racing No. 16: This charter is owned by Kaulig Racing and linked to the No. 16 car. Its journey began with Tommy Baldwin Racing as the No. 7, then moved through Leavine Family Racing and Spire Motorsports before its acquisition by Kaulig.

Legacy Motor Club No. 42: Associated with John Hunter Nemechek’s No. 42, this charter has a lineage tracing back to Richard Petty Motorsports. It has navigated multiple ownership changes, including Petty GMS Racing, before becoming Legacy Motor Club.

23XI Racing No. 35: This charter, most recently associated with Riley Herbst in the No. 35, was previously part of Stewart-Haas Racing’s No. 10. Its transfer to 23XI Racing in 2024 was also a subject of the antitrust litigation.

Joe Gibbs Racing No. 11: Consistently linked to Denny Hamlin’s No. 11, this charter has remained with Joe Gibbs Racing since its award.

23XI Racing No. 23: Driven by Bubba Wallace, this charter was formerly Germain Racing’s No. 13 before being sold to Denny Hamlin and Michael Jordan’s 23XI Racing. Its status is currently under legal review due to the antitrust lawsuit.

Trackhouse Racing No. 88: This charter is currently utilized by Trackhouse Racing for Shane Van Gisbergen’s No. 88. It originated as Stewart-Haas Racing’s No. 14, driven by notable figures like Tony Stewart and Chase Briscoe.

Haas Factory Team No. 41: Owned by Haas Factory Team, this charter has a long-standing association with the No. 41. It was initially awarded to Michael Waltrip Racing and quickly acquired by Stewart-Haas Racing, with a lineage including Kurt Busch and Cole Custer.

RFK Racing No. 6: This entry, now known as the RFK Racing No. 6, began as Roush Fenway Racing’s No. 16. It underwent a renumbering to become the No. 6 for charter purposes and has been driven by Brad Keselowski since 2022.

RFK Racing No. 17: Associated with Chris Buescher’s No. 17, this charter has been with Roush Fenway Racing since its inception, consistently linked to Jack Roush.

Joe Gibbs Racing No. 54: Driven by Ty Gibbs, this charter was previously Joe Gibbs Racing’s No. 18, driven by Kyle Busch, before being renumbered for the 2023 season.

Joe Gibbs Racing No. 20: This charter is owned by Joe Gibbs Racing and driven by Christopher Bell, with a history that includes drivers Matt Kenseth and Erik Jones.

Team Penske No. 22: This charter has been consistently associated with Joey Logano’s No. 22 at Team Penske since its inception.

Spire Motorsports No. 7: The No. 7 charter has a complex ownership history, starting with BK Racing, then moving to Front Row Motorsports, Rick Ware Racing, and eventually Spire Motorsports. Justin Haley is the current driver.

Hendrick Motorsports No. 9: Driven by Chase Elliott, this charter originated as Hendrick Motorsports’ No. 24 before being renumbered to the No. 9.

23XI Racing No. 45: Piloted by Tyler Reddick, this charter began as Richard Childress Racing’s No. 27, later being leased and sold to StarCom Racing before its acquisition by 23XI Racing. Its status is also impacted by the antitrust lawsuit.

Richard Childress Racing No. 8: Kyle Busch drives this charter for Richard Childress Racing. It was initially the No. 31, then became the No. 8, with a driver history including Daniel Hemric and Tyler Reddick.

Wood Brothers Racing No. 21: This charter began with GoFas Racing and was eventually sold to the Wood Brothers. After stints with drivers like Ryan Blaney and Matt DiBenedetto, Harrison Burton piloted the car before Josh Berry took over for 2025.

Spire Motorsports No. 71: This charter, with the most intricate ownership trajectory, started with Circle Sport Racing and passed through multiple hands, including Leavine Family Racing, The Motorsports Group, GoFas Racing, and Live Fast Motorsports, before being acquired by Spire Motorsports. Michael McDowell is the driver for 2025.

Front Row Motorsports No. 34: This charter has remained with Front Row Motorsports since its inception, driven by various drivers including Michael McDowell and now Todd Gilliland. Its chartered status is also under legal scrutiny.

Rick Ware Racing No. 51: This charter began as Front Row Motorsports’ No. 38, was leased to TriStar, and subsequently sold to Rick Ware Racing. It has seen frequent number changes to maintain its chartered status.

Trackhouse Racing No. 99: Driven by Daniel Suarez, this charter was originally awarded to Chip Ganassi Racing as the No. 42 before being acquired by Trackhouse Racing and renumbered.

Legacy Motor Club No. 43: This charter, now driven by Erik Jones, has a direct lineage from Richard Petty Motorsports and has undergone ownership changes through Petty GMS Racing to become Legacy Motor Club.

HYAK Racing No. 47: This charter, associated with Ricky Stenhouse Jr.’s No. 47, has been with JTG-Daugherty Racing since its inception, with a recent rebranding to HYAK Racing.

Hendrick Motorsports No. 5: Currently driven by Kyle Larson, this charter originated as Hendrick Motorsports’ No. 48, driven by Jimmie Johnson, before being reassigned to the No. 5.

RFK Racing No. 60: This charter, leased to RFK Racing for Ryan Preece in 2025, began with HScott Motorsports and has passed through Premium Motorsports and Rick Ware Racing.

Joe Gibbs Racing No. 19: Driven by Chase Briscoe starting in 2025, this charter has been with Joe Gibbs Racing since its early days, having been awarded to Michael Waltrip Racing and immediately sold to JGR. Martin Truex Jr. was the most recent driver.

Spire Motorsports No. 77: Piloted by Carson Hocevar, this charter began as Premium Motorsports’ No. 62, was leased to HScott Motorsports, then sold to Furniture Row Racing, Todd Braun, and finally Spire Motorsports.

Kaulig Racing No. 10: This charter, currently associated with Ty Dillon’s No. 10, started as Furniture Row Racing’s No. 78, then moved through Spire Motorsports and Trackhouse Racing before its acquisition by Kaulig Racing.

Front Row Motorsports No. 38: Driven by Zane Smith in 2025, this charter originated with BK Racing, was leased to TriStar, and has been with Front Row Motorsports since 2018. Its chartered status is also subject to legal review.

Hendrick Motorsports No. 48: Driven by Alex Bowman, this charter began as Hendrick Motorsports’ No. 88, driven by Dale Earnhardt Jr., before being reassigned to the No. 48 upon Jimmie Johnson’s retirement.

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